Bangladesh is projected to meet the United Nations' millennium development goal of eradicating extreme hunger and poverty by 2015, according to a survey of the Asian Development Bank.

Though poverty has declined remarkably, the prevalence of malnourishment in 25 million or 16.8 percent of its population is still a major concern, the country being in the third position among its South Asian neighbours.

The study, which was released yesterday, went into each value chain segment of two main food and vegetable -- rice and potato.

It looked at these chains linking Naogaon and Bogra districts, the rural centers that are major producers and suppliers of these food commodities to the megacity Dhaka.

The study -- The Quiet Revolution in Staple Food Value Chains: Enter the Dragon, the Elephant and the Tiger -- was produced by the ADB and the International Food Policy Research Institute in response to the 2008 spike in food prices.

It analysed domestic rice and potato supply chains in Bangladesh, India and China.

“Asia faces a formidable challenge of feeding five billion people by 2030,” said Bindu Lohani, ADB's vice president for knowledge management and sustainable development.

“Rising populations and incomes, resource degradation and climate change will keep putting upward pressure on food prices, requiring vast improvements to ensure adequate, affordable food supplies.”

The study said achieving food security is one of the priority agendas of the government in Bangladesh, with modernising the food staples value chains being one of its action agendas.

A structural transformation is occurring and changing the conduct, performance and structure of the rice and potato value chain segments quite rapidly.

Village traders are playing a greatly diminished role in sourcing rice and potatoes. In rice, village traders garnered only 7 percent share of farms and sales in the upstream segment. In potatoes, the village traders were the source of only 16 percent of the Bogra-Dhaka chain, it said.

Two thirds of the rice farmers interviewed were bypassing middlemen and were selling their rice directly to wholesalers or mills.

Around 90 percent of small-scale potato farmers are storing their potatoes in cold storage facilities, and they use the facilities as intermediary venues for selling their produce to local traders, found the study.

It said Bangladesh is just starting its transformation to modern retailing. Rural wholesale markets displaced village traders, buying direct from farmers and selling direct to mills, who sell their produce to Dhaka's retailers.

The number of supermarkets in Dhaka was about 80 in 2009, from 4 in 2001, and they are catering to the middle to upper-income clients.

Small-scale rice and potato farmers producing for the Dhaka market are run as commercial businesses, responsive to technology and prices.

Helped by national agriculture research centres, farmers shifted from coarse to quality rice production, faster than their Indian and Chinese counterparts.

About 25 percent of seeds were also subsidised and sold by Bangladesh Agricultural Development Corporation.

More than 80 percent of the rice and potato farmers having mobile phones negotiate prices for their produce and obtain other information about the market, said the study.

More integrated rice and potato chains benefited urban consumers with affordable price for quality rice, and year-round supply of potatoes.

Farmers' incomes have also increased. Farmer's share of the retail price of rice is roughly 60 percent, while for potatoes their share is 50 percent.

The study said affordable and stable domestic prices for rice and potatoes can be achieved not just at improvements at the farm production level, which is often the focus on interventions, but more importantly, at the post harvest levels through more private sector engagement.

The ADB study also indicated that agriculture's share to gross domestic product has declined through the years, down to 20 percent in 2011, next to services and industry sectors. The sector still employs about 47 percent of the country's labour force.

News: The Daily Star/Bangladesh/11th-Dec-12